With the S&P diving deeper into bear territory today, it solidly confirmed its status as a bear. While it entered the bear’s woods on Monday by closing at 21.8% down, it shoved its nose deeper into the dirt today like a rooting bear will do to affirm its new identity. The short-lived bull market that began in 2020 is now officially dead in proclamations all over the internet by those who won’t acknowledge we’re in a bear market until the S&P proves it, regardless of other indices.
Well, now it has proved it for those who needed that proof. Overnight, we have shifted to where scarcely a soul around doesn’t recognize that Fed Chair Powell was the matador who killed the bull by stabbing his inflation-fighting darts along the bull’s spine until the great S&P fell to the ground, quivering at his feet. And that is all they were is darts — not swords — for he barely did more than speak about his bold plans.
Nearly everyone — even the Fed — now acknowledges that inflation became so hot and so prolonged it forced the Fed to fight it. Even Janet Yellen confessed she was wrong about inflation being merely transitory. It has turned out to be quite a ravaging little monster. It also drove bond yields skywards and is now absolutely crushing bond funds and starting to wreak havoc between the sovereign debts of European nations, placing the entire global bond market in peril of catastrophic collapse. Not everyone will admit this, but many feel the possibility of such a calamity deep within their chests as articles about it are becoming more numerous. The outward signs are obvious for those willing to look.
Today’s move of the S&P places three major indices fully in the bear’s forest — the Russell 2000, the Nasdaq and now, at last, and firmly, the S&P. The long-unfolding crash that got us here began for the S&P at the start of the year and became the worst losing streak for the S&P since the dot-com bust. That’s a fact.
The rest is here: https://thegreatrecession.info/blog/sp-confirms-inflation-killed-the-stock-market-and-has-already-sent-us-into-recession/